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Housing prices jump

I find it funny that we are building more houses in this climate. Can’t we just put on the brakes until the current housing inventory sells? Banks have wised up to the growing supply of homes on the market. They are keeping a substantial amount of foreclosed homes off the market to prevent further devaluing in home prices. Its basic supply and demand people!  I charted US home prices data against residential foreclosures over the past 5 years. As foreclosures move up, prices move down. It’s a perfect inverse correlation:

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